Urban Logistics Reit Share Discussion Threads

[jombaston] 05/5/2020 13:03

LMP is raising money to go shopping for more urban logistics (the asset class not the company)

[dhoult12] 30/4/2020 08:29

Yes, i got 'stuck' in the placing as the broker didn't follow through with the pull instruction. Less annoyed about it now than at the time...

Still think these are a good shout. What would have taken 5 years with retail to make the shift to delivery will now try and be rushed through in 5 months. Can see large demand for sites once people realise last mile is a bottleneck in the system

[jbarcroftr] 30/4/2020 07:26

great acquisitions .i completely agree with their view of the last mile logistic market

[skinny] 30/4/2020 07:06

.

The Company announces that on 29 April 2020 it acquired seven properties (the "Crown Portfolio") for a total consideration of £47.2 million.

Highlights

§ £47.2 million portfolio acquisition at a net initial yield ("NIY") of 7.0%

§ Seven distribution sites, with average warehouse size of 84,105 sq ft, located in Aberdeen, Huntingdon, Blackpool, Ipswich, Newmarket, Plymouth and Rotherham

§ Low capital value of £68 per sq ft

§ Low average passing rent of £4.96 per sq ft

§ Acquisitions are fully funded from the proceeds of March's £136.1 million equity capital raise

more.....

[jbarcroftr] 29/4/2020 10:30

Are we expecting an announcement tomorrow of further purchases?

[belgraviaboy] 15/4/2020 08:46

Probably worth a clarifying RNS

[spectoacc] 15/4/2020 08:13

Good point. I forget the terms - so CNCT did sale-and-leaseback to SHED, of the Tufnells properties. Tufnells now getting sold on in partial MBO. What happens to parent co guarantees etc? Assume SHED made sure they were well covered for this eventuality, so should be "no change".

[belgraviaboy] 15/4/2020 08:08

Hmmm - thoughts on the Tuffnels situation?

[trekker60] 10/4/2020 09:10

dhoult12, spectoacc and others. Thanks for your recent civilised and rational discussion - makes a pleasant change from all the ranting, ramping/deramping seen on so many discussion boards (including this one on certain occasions!) and so much more interesting.

[dhoult12] 09/4/2020 18:04

I think thats fair. This IMHO is still a reasonably 'safe' place to protect against inflation while accepting you wont get stellar returns or losses. When they were at lows with a 9% divi yield it really was easy money for the brave

[essentialinvestor] 09/4/2020 09:34

Interesting view on the V shaped recovery.

There is going to be a snapback, however it's a snap back from an extraordinary fall
in economic activity. Would expect that still leaves multiple countries nursing a painful recession imv.

GAP to the last reported NAV has now closed very considerably, so short term
the easy money may have been made?.

[dhoult12] 09/4/2020 09:14

Not sure i agree reference June rent. The commercial and shopping REITs have all had Q2 rent collection figures of under 50%. If i was the FD at a high street fashion chain and all my stores were shut i am not paying anything. No rent, no suppliers etc I would not say pay the warehouse rent but not the store rent. The postal service and other delivery suppliers are still going as are online only who rent a lot of these and are paying suppliers. All about duration now, 3 months i think we will have disposable income and a V shaped recovery. 6 months less so... Just do not want to be holding cash in this environment for too long, particularly if the oil price rises which would remove that deflationary measure. IMHO asset backed defensive stocks are a good shout.We will see!

[nickrl] 08/4/2020 22:40

This isn't specifically a SHED issue but behind every retailer, pub, restaurant and leisure business that closes, temporarily or permanently, sits a supply chain that needs a warehouse, an industrial unit and office space so if the former start disappearing there is a trickle down impact on the latter. Yes there maybe transfer to online, supermarket or takeaway but all this presumes that disposable income is still there which is very unlikely. This is why Junes qtrly rent participation will be more representative of the wider impact and will begin to inform where valuations are going.

[dhoult12] 08/4/2020 17:30

No that is fair enough. I also got caught on the placing in similar circumstances. Such as life - my average is still sub 110p though so lucky. Unit trusts i dont think impacts at the property level. If i owned one of these warehouses and someone pulled the offer of say £500k and im still getting a 6% yield. Im not selling to someone else for £300k in 6 months time. I will just sit. At a share level that will have in impact, although one might expect more in larger companies than SHED. I think until the recent placing this was below the radar in terms of liquidity and size. Infact a lot of the reason for the placing was to increase the size of the REIT to one where the funds might invest. Good luck with the profits!

[spectoacc] 08/4/2020 16:13

90% rent is great, I agree, tho wasn't much shut-down to end of March, ie next quarter end will be more interesting.

But I agree Last Mile is a sweet spot.

Unit Trust selling will be massive and indiscriminate tho, & won't have started yet. Some of that will be warehouse end.

Another bull point for SHED - at some point they'll likely get bought out, in the same way HSTN was.

Having held since 100p, getting caught out in the 137.5p placing when Selftrade didn't pull my request in time, and averaging on the dip, I guess today's RNS was the nudge for me to take profit. Will aim to avoid deramping it on here whilst I'm out.

[dhoult12] 08/4/2020 16:08

Turn it around. They have just had over 90% rent paid during a shut down, BBOX have had similar. The seller of these assets one would expect are also having their rent paid. Why would you sell at massive discount in 6 months? Shopping centers will struggle as will pubcos but i cant see falls in logistic property's. Yes some retailers will go under like Debs but others such as Primark will want to offer online and expand after this.

[spectoacc] 08/4/2020 15:52

Don't get me wrong, I love SHED - they've done everything they set out to do, and by chance brilliantly timed that fundraising.

But having the cash, surely now was the time to consolidate, support the tenants they've got, be completely immune from any debt issues, then dive in when capital values fall. Not pay more or less the same prices (based on yields) they'd have paid pre-Covid.

They're not going bust, they're in a favourable sector, but whether these acquisitions look good in 12 months, I suspect they'd have been cheaper in 6 months. And that's not to knock c.6% yields in a 0.1% interest rate world, but is to knock tenant security. Yield is 0% if the tenant's gone bust & no one clamouring for the space.

They traded through the last two cycles, they ought to know this. Maybe Last Mile really will prove to be the one winning sector.

Or maybe they just hold the opposite view on Covid-19.

[essentialinvestor] 08/4/2020 15:47

Will those acquisitions look value in 12 months time?.

BOD don't exactly hold a shed load of shares?.

[spectoacc] 08/4/2020 15:41

True, but. We're avoiding the mass unemployment by the govnt borrowing the money and paying 80% (of both furloughed and self-employed). Not convinced that's any better.

And re "...Shop, restaurant owner.." - trends of failing High St & less eating out seem highly likely to accelerate, at least until 12/18 months time when there'll hopefully be a vaccine. I can't see all those jobs coming back.

There should at least be some pent-up demand, but most of the GDP being lost now is not going to be recovered - people won't suddenly eat out twice as much to make up..

[dhoult12] 08/4/2020 15:34

US employment is very different to European. Typically workers do not have contracts (even at wall street trading firms), hence the whole "i quit" and "your sacked today" in the movies. As such any shop, restaurant owner etc can literally just let all their staff go the same day when told to shut and then rehire all again on the day they open. Most will do that. Leads to a lot more volatility in those figures. Numbers look extreme due to that culture - we have not had mass closures like this even in wartime. We also haven't had mass openings which will come. Time will tell the impact.

[spectoacc] 08/4/2020 13:30

10m US unemployed within days says depression baked in, duration the only question. But fair point re stimulus, tho the resultant debt brings its own problems (surely no more austerity?). Fair point on real assets too, tho gold surely the main one :)

[dhoult12] 08/4/2020 12:14

Agreed, i personally do not think there will be a depression. I can see central banks overstepping the mark, some are even talking about direct purchasing of government debt in the primary bond auction market. That is just printing money the old school way! i would much rather hold assets than cash in that environment. We will see, all guess work at the moment.

[nickrl] 08/4/2020 11:44

Dhoult the ingredients are there for a depression but the counterbalance is the huge liquidity injection and business support measures that every govt has taken. Exactly whether the latter is sufficient to limit it to a recession is dependent on how long it goes on for imo. My other measure of confidence, others may see it as weakness or being foolhardy, is those businesses, along with there funders, who recognise the world has changed and work together to survive it by all sharing in the pain. By constraining certain insolvency actions for three months and hopefully longer it will encourage joint solutions and not legal redress and leave a lot more intact.

Currently though there is so much uncertainty that the market is surely only reflecting hope not certainty so not good for a long term investor like myself. Those with balls have done very well but it could easily step down again but suspect it will tread water for a few weeks but at first sign of relaxation it will no doubt surge.

[spectoacc] 08/4/2020 11:40

Credit to BBOX and yes - selling most equities :)

(Tho some simply don't have a market).

[dhoult12] 08/4/2020 11:07

If you think there will be a depression i would sell all equities not just SHED.

Current prices are a bet on a reasonable recovery and an asset based hedge against inflation that may occur based on all the QE printed so far.

BBOX has already risen a lot in the last couple of weeks and strong buyers there.